EXHIBIT 99.1
Computer Programs and Systems, Inc. Announces Record Third Quarter Results;
Company Declares Regular Quarterly Dividend of $0.22 Per Share
MOBILE, Ala.--(BUSINESS WIRE)--Oct. 20, 2005--Computer Programs
and Systems, Inc. (NASDAQ/NM:CPSI):
Highlights:
-- Established new high marks for quarterly net income, revenue
and cash collections;
-- Generated free cash flow of $4.8 million;
-- Signed contracts for system installation at 11 new client
hospitals, averaging $625,000 per facility; and
-- Declared regular quarterly dividend of $0.22 per share.
Computer Programs and Systems, Inc., a leading provider of
healthcare information solutions, today announced results for the
third quarter and nine months ended September 30, 2005.
The Company also announced that its Board of Directors has
declared a regular quarterly cash dividend of $0.22 (twenty-two cents)
per share, payable on November 25, 2005, to shareholders of record as
of the close of business on November 4, 2005.
Total revenues for the third quarter ended September 30, 2005,
increased 27.8% to $27.0 million, compared with total revenues of
$21.1 million for the prior year period. Net income for the quarter
ended September 30, 2005, increased 70.9% to $3.6 million, or $0.33
per diluted share, compared with $2.1 million, or $0.20 per diluted
share, for the quarter ended September 30, 2004. Cash flow from
operations for the third quarter of 2005 was $5.4 million, compared
with $3.3 million for the same period last year.
Total revenues for the nine months ended September 30, 2005,
increased 37.7% to $80.4 million, compared with total revenues of
$58.4 million for the prior year period. Net income for the nine
months ended September 30, 2005, increased 137.9% to $10.2 million, or
$0.96 per diluted share, compared with $4.3 million, or $0.41 per
diluted share, for the nine months ended September 30, 2004. Cash
provided from operations for the nine months ended September 30, 2005,
was $11.8 million, compared with $8.0 million for the same period last
year.
Commenting on the results, David Dye, chief executive officer and
president of CPSI, stated, "Our year-to-date performance is indicative
of both a strong marketplace among community hospitals for information
technology and our competitive success within that marketplace. Based
on the continually increasing emphasis on the use of technology to
improve financial and clinical efficiency and to provide caregivers
with a secure electronic medical record for their patients, we remain
optimistic about CPSI's long-term growth prospects."
For the fourth quarter of 2005, the Company anticipates total
revenues of $26.5 to $28.0 million and net income of approximately
$3.5 to $3.8 million, or $0.33 to $0.35 per diluted share. CPSI's
12-month backlog as of September 30, 2005, was $77.3 million,
consisting of $22.1 million in non-recurring system purchases and
$55.2 million in recurring payments for support, outsourcing, ASP and
ISP contracts.
A listen-only simulcast and replay of CPSI's third quarter
conference call will be available on-line at www.cpsinet.com and
www.earnings.com on October 21, 2005, beginning at 9:00 a.m. Eastern
Time.
About Computer Programs and Systems, Inc.
CPSI is a leading provider of healthcare information solutions for
community hospitals with over 550 client hospitals in 45 states.
Founded in 1979, the Company is a single-source vendor providing
comprehensive software and hardware products, complemented by complete
installation services and extensive support. Its fully integrated,
enterprise-wide system automates clinical and financial data
management in each of the primary functional areas of a hospital.
CPSI's staff of over 800 technical, healthcare and medical
professionals provides system implementation and continuing support
services as part of a comprehensive program designed to respond to
clients' information needs in a constantly changing healthcare
environment. For more information, visit www.cpsinet.com.
This press release contains forward-looking statements within the
meaning of the "safe harbor" provisions of the Private Securities
Litigation Reform Act of 1995. These forward-looking statements can be
identified generally by the use of forward-looking terminology and
words such as "expects," "anticipates," "estimates," "believes,"
"predicts," "intends," "plans," "potential," "may," "continue,"
"should," "will" and words of comparable meaning. Without limiting the
generality of the preceding statement, all statements in this press
release relating to estimated and projected earnings, margins, costs,
expenditures, cash flows, growth rates and future financial results
are forward-looking statements. We caution investors that any such
forward-looking statements are only predictions and are not guarantees
of future performance. Certain risks, uncertainties and other factors
may cause actual results to differ materially from those projected in
the forward-looking statements. Such factors may include: overall
business and economic conditions affecting the healthcare industry;
saturation of our target market and hospital consolidations; changes
in customer purchasing priorities and demand for information
technology systems; competition with companies that have greater
financial, technical and marketing resources than we have; failure to
develop new technology and products in response to market demands;
fluctuations in quarterly financial performance due to, among other
factors, timing of customer installations; failure of our products to
function properly resulting in claims for medical losses; government
regulation of our products and customers; interruptions in our power
supply and/or telecommunications capabilities and other risk factors
described from time to time in our public releases and reports filed
with the Securities and Exchange Commission, including, but not
limited to, our Annual Report on Form 10-K. We also caution investors
that the forward-looking information described herein represents our
outlook only as of this date, and we undertake no obligation to update
or revise any forward-looking statements to reflect events or
developments after the date of this press release.
COMPUTER PROGRAMS AND SYSTEMS, INC.
Unaudited Condensed Statements of Operations
(in thousands, except per share data)
Three Months Ended Nine Months Ended
September 30, September 30,
----------------- -----------------
2005 2004 2005 2004
------- ------- ------- -------
Sales revenues:
System sales $12,480 $9,055 $37,779 $23,845
Support and maintenance 10,982 9,454 31,688 28,018
Outsourcing 3,538 2,623 10,900 6,495
------- ------- ------- -------
Total sales revenues 27,000 21,132 80,367 58,358
Cost of sales:
System sales 8,511 7,048 24,932 19,627
Support and maintenance 4,864 4,180 14,102 12,438
Outsourcing 2,168 1,482 6,255 3,833
------- ------- ------- -------
Total cost of sales 15,543 12,710 45,289 35,898
------- ------- ------- -------
Gross profit 11,457 8,422 35,078 22,460
Operating expenses:
Sales and marketing 1,911 1,405 5,520 4,134
General and administrative 3,839 3,680 13,071 11,497
------- ------- ------- -------
Total operating expenses 5,750 5,085 18,591 15,631
------- ------- ------- -------
Operating income 5,707 3,337 16,487 6,829
Interest income, net 177 62 431 181
Other -- 50 5 128
------- ------- ------- -------
Income before taxes 5,884 3,449 16,923 7,138
Provision for income taxes 2,319 1,363 6,715 2,848
------- ------- ------- -------
Net income $3,565 $2,086 $10,208 $4,290
======= ======= ======= =======
Basic earnings per share $0.34 $0.20 $0.97 $0.41
======= ======= ======= =======
Diluted earnings per share $0.33 $0.20 $0.96 $0.41
======= ======= ======= =======
Weighted average
shares outstanding:
Basic 10,604 10,490 10,541 10,490
Diluted 10,696 10,533 10,628 10,531
COMPUTER PROGRAMS AND SYSTEMS, INC.
Condensed Balance Sheets
(in thousands)
Sept. 30, Dec. 31,
2005 2004
------- -------
ASSETS (Unaudited)
Current assets:
Cash and cash equivalents $10,588 $13,785
Investments 8,174 --
Accounts receivable, net of allowance for doubtful
accounts of $1,560 and $1,636 respectively 12,972 11,765
Financing receivables, current portion 1,504 974
Inventory 1,807 1,475
Deferred tax assets 1,559 1,397
Prepaid expenses 441 438
Prepaid income taxes -- 172
------- -------
Total current assets 37,045 30,006
Financing receivables, long-term 668 618
Property and equipment 11,291 10,659
Accumulated depreciation (5,358) (5,205)
------- -------
Total assets $43,646 $36,078
======= =======
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $1,705 $970
Deferred revenue 3,419 2,602
Accrued vacation 1,953 1,631
Other accrued liabilities 1,829 2,323
Income taxes payable 141 --
------- -------
Total current liabilities 9,047 7,526
Deferred tax liabilities 686 718
Stockholders' equity:
Common stock, par value $0.001 per share,
30,000,000 shares authorized, 10,608,083 and
10,489,849 shares issued and outstanding 11 10
Additional paid-in capital 20,125 17,292
Deferred compensation (85) (123)
Accumulated other comprehensive income (53) --
Retained earnings 13,915 10,655
------- -------
Total stockholders' equity 33,913 27,834
------- -------
Total liabilities and stockholders' equity $43,646 $36,078
======= =======
COMPUTER PROGRAMS AND SYSTEMS, INC.
Other Supplemental Information
(In thousands)
The following table summarizes free cash flow for the Company:
Three Nine
Months Months
Ended Ended
Sept. 30, Sept. 30,
2005 2005
------- -------
Net cash provided by operating activities $5,385 $11,829
Purchases of property and equipment (554) (1,767)
------- -------
Free cash flow $4,831 $10,062
======= =======
Free cash flow is a non-GAAP financial measure which CPSI defines as
net cash provided by operating activities less purchases of property
and equipment. The most directly comparable GAAP financial measure is
net cash provided by operating activities. The Company believes free
cash flow is a useful measure of performance and uses this measure as
an indication of the financial resources of the Company and its
ability to generate cash.
CONTACT: Computer Programs and Systems, Inc.
M. Stephen Walker, 251-639-8100